Guiding consumers since 2009

Forecasts for 2009

By Staff Writer

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Forecasts for 2009

The papers are dusting off their crystal balls and looking into the future.

Forecasting is a notoriously difficult business from the Oracle of Delphi to the modern day ratings agency, getting it wrong can cost and cost dearly.

Justmoney has no way to see the future; we can expect certain things to happen because they have been developing along a certain track for a certain period.

If the train is going too fast and you know it has no brakes, you can take a good guess that at some point it will derail, what you can't guess is exactly where it will be or how much damage it will cause. You can bet on the ratio of severity to frequency, you can look at where the tracks take a sharp turn, but to finalise this rather extended analogy, the best thing to do is to have a crash helmet on.

In money terms this would be a savings account. In general a buffer of three months of your expenses should see you through a financial train smash. More is better and with the current global uncertainty a six month buffer fund might do you better.

This is what the news outlets think will go down.

BUA news the government news outlet looked at the dropping fuel price and reckoned that this should bring about a positive change for consumers in 2009. They also state that 'Many South Africans will be hoping that the economic environment will have the Reserve Bank's Monetary Policy Committee (MPC) favouring an interest rate cut when they meet again in February 2009'.

Do they have an inside ear? Possibly but the market is also pricing in rate cuts, so they seem to be fairly guaranteed. BUA adds the caveat that The Gov, Tito Mboweni was still worried about the exchange rate.

IOL reports that although the petrol price has fallen to levels not seen since March 2007, the taxi industry has no intention of passing these cuts onto commuters. Cosatu who had joined with taxi operators to protest the high price of petrol will now pressure taxi operators to pass the cuts down.

Business Day looks into the future and calls it a tough one. They note that several top analysts are opining growth to slow to less than one percent this year. They looked at job losses putting a damper on consumer spending and private investment also likely to contract.

Business Report looked at the housing market and asked Re/Max what they thought. Re/Max a global operation believes that the local housing market will recover before that of the US. They 'said the fact that local banks were now asking for deposits of at least 20 percent in the falling market was the biggest negative'. However Re/Max planned on opening 40 new offices in SA this year.

The Dispatch quoted the KZN MEC for agriculture saying that food prices should also drop in line with the drop in petrol prices. He said his department would be looking closely at this issue.

The Times predicts a surge in consumers seeking debt counselling, with an expected 500% increase to 150 000 South Africans undergoing debt counselling by June 2009. Scary stuff, but debt counselling can help you get back on track and if you are worried, rather do it sooner than after your assets have been taken away. Justmoney hopes for a great 2009, but prudence should be the watch word this year.

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